University of California Institute for Labor and Employment

Living wage mandates legislate minimum hourly wages that are considerably higher than minimum wage rates. Since 1994 living wage ordinances have been passed and, in varying degrees, implemented in over ninety-five local governmental entities in the United States; among them are twenty-one California cities. The author presents a summary of the living wage ordinances in California, including their wage mandate levels and their coverage. He discusses how the minimum wage and the federal poverty standard have failed to keep up with increased living costs, especially in California’s cities, and reviews arguments for and against living wage policies. The author also surveys older academic studies on minimum wage and living wages and then discusses a new generation of research studies on the impacts of living wages. This new set of studies, which includes detailed analyses of Los Angeles and San Francisco, provides a more careful and complete understanding than was previously available. Using before-and-after surveys of employers and workers and more sophisticated methodology, they reveal that living wage policies increase pay for their intended beneficiaries without creating disemployment effects. Living wage policies also reduce employee turnover and absenteeism and improve worker performance, thereby creating some employer savings in the short run and generating incentives for productivity growth in the long run. The policies’ costs to employers and taxpayers are considerably smaller than some have projected. The author concludes by discussing recent developments in living wage campaigns that may lead to greater impacts in the future.

The University of California (UC) is a pathway into many of the most coveted jobs in the California economy, and the promise that all Californians will have the equal opportunity to acquire a UC education is a core part of California’s social contract. The authors describe UC’s admissions policy and explore inequalities in the access that California secondary schools provide to UC. Their measure of access is the rate of admission, or the percentage of a school’s graduates admitted to UC, circa 1999. By merging data provided by UC with data provided by the California Department of Education, the authors are able to examine the rates of admission to UC from most of the individual high schools in the state. They explore inequalities associated with the race and socioeconomic status of the student bodies of these schools.

The authors find that a small number of privileged schools provide disproportionate access to UC. The average UC admissions rate for nonsectarian private schools is almost three times that for public schools. Public schools in affluent communities also have unusually high UC admissions rates. So do public schools with primarily Anglo and Asian student bodies. The authors consider recent policy interventions that aim to equalize admissions rates across schools by raising the floor or increasing the admissions rates of the lowest schools. They conclude that these policies are unlikely to have much impact on unequal access to UC, since they do nothing to reduce the yawning gap between the majority of schools and a small tier of elite public and private schools at the top.

This analysis of California union membership draws on data from the 2001–02 California Union Census (CUC), a new survey of local unions conducted by the Institute for Labor and Employment, as well as selected data from the Current Population Survey. The focus is the recent divergence of California from the United States as a whole: while union density has continued its long decline nationwide, in California it has increased over the past few years. This divergence reflects not only the ways in which labor’s political strength in the state has facilitated recruiting new union members but also California’s distinctive labor history. The relatively large share of union membership held by the Service Employees (SEIU) in California yielded disproportionate growth for the state’s labor movement in the 1990s, as this union became the nation’s single most rapidly growing labor organization. The authors also examine variation in union membership by industry, region, and across key demographic groups. In both California and the nation, for example, union density is much higher in the public sector than in the private sector. Women and African Americans have higher unionization rates in California than nationally; the rates are similar in the state and nation for immigrant workers, who are less unionized than their native-born counterparts in both cases. Finally, the authors look at data on union staffing levels. The key finding here is that organizing staff are employed by relatively few local unions, but that those that do employ them are the fastest growing.

The effective stalemate over national labor law reform that began in the 1970s has prompted employer groups and organized labor to increasingly shift their attentions to legislation at the state and local levels. Unions and their allies have sought to enact, for example, laws that limit the use of public money for pro- and anti-union activities, laws providing card check recognition for certain groups of employees, and responsible contactor legislation. The author examines two of these types of laws: neutrality laws at the state level and labor peace agreements at the local level. In September 2000 California became the first state in the nation to enact a “state neutrality” law with effective enforcement mechanisms. Assembly Bill 1889 prohibits employers from using state money, received in the form of grants, loans, contracts or reimbursements, to promote or deter unionization. The author describes the background to the law, its provisions and impact, and employers’ legal challenge to the law. California has also been at the forefront of promoting labor peace agreements at the city and county levels. The author examines these agreements, which require that employers sign labor peace agreements with unions as a condition of receiving financial assistance from the city or county. The chapter concludes with an examination of how recent state and local legislative developments are likely to influence the campaign for labor law reform at the federal level.

The authors assess the status of recent organizing efforts in California and examine the challenges that must be overcome if California unions are going to significantly increase union density in the state. Through their analysis of a combination of national and state data on employment, union membership, workforce and union demographics, and public and private sector union organizing activity, they find that unions in California have been more successful than unions in other states in increasing union membership and density in both the private and public sectors. In particular, the California labor movement has made significant strides in organizing immigrant workers, especially in health care and other services. Still, when placed in the context of employment growth, the authors find that organizing gains in California continue to be relatively modest and have been concentrated in a limited number of occupations and industries. Using their findings from a national survey of NLRB election campaigns, the authors argue that unions in California will only be able to fulfill the potential provided them by increasing density and a diverse workforce if they run more comprehensive organizing campaigns and more effectively use their political influence and bargaining power to improve the environment for organizing in the state.

California’s state budget crisis and soft economy have conditioned its labor relations climate. Roughly half of union workers are in the public sector and so are affected by fiscal distress. Neither employers nor economic forecasters expect a robust economic recovery in the state in the near term. A number of union-supported bills were enacted under Governor Gray Davis, including a new paid family leave program, a hike in unemployment insurance benefits, and a mandated mediation process for union-represented farm workers. Nevertheless, state social programs have come under stress. The California Compensation Insurance Fund, which provides workers’ compensation insurance for employers unable to buy it elsewhere, is having financial problems. Lack of job-based health insurance for many low-wage workers has revived legislative interest in alternative proposals for universal coverage. Because of the budget squeeze, threats of layoffs and demands for pay freezes have marked labor relations in government. Job security has been an issue in the private sector, notably in the longshore lockout during the fall of 2002. Health care has been a focus of union organizing and labor disputes, especially involving nurses, against a backdrop of downward pressure on public health program spending and widespread employer concerns about escalating premiums. Until there is a clear-cut improvement in economic conditions, in both public and private sectors, labor relations will continue to reflect an environment of limited resources.

The 1990s were a period of record immigration to California and the United States, with both legal and unauthorized immigrants arriving in the country and state, a trend that will likely continue in the twenty-first century. Many observers have been concerned that a bimodal pattern of immigrant education, with many immigrants either being poorly or very well educated, overlaps too closely with the increasingly polarized distribution of job growth in the country. The authors’ analysis of changing employment patterns and the shifting distribution of bad and good jobs in the 1994–2000 economic boom suggests, however, that immigration is not fundamentally driving the emergence of a polarized job structure in either California or the United States. That structure derives largely from changes among the native born, suggesting that shifts in labor demand explain the pattern, rather than increases in the supply of less-skilled and highly skilled immigrant workers. Immigrants in California, however, do contribute to the polarization to varying degrees, depending on race/ethnicity, gender, and location. The authors’ analysis of arrival cohort data suggests substantial immigrant upward mobility, mainly from lower to middle-range jobs in Los Angeles and from middle to higher range jobs in the San Francisco Bay Area. This does not mean that predictions based on racial/ethnic stratification theories are inaccurate, but it does suggest that such perspectives should be modified by taking into account the effects of newcomer status and the likelihood that immigrants may experience more upward mobility than many commentators presume.

The author summarizes the contents of the 2003 issue of The State of California Labor, an annual publication of the University of California Institute for Labor and Employment.